German crane manufacturer Demag Cranes has labeled US competitor’s Terex’ $1.3 billion bid to be “not appropriate”.
On 2 May, Terex offered shareholders of the company $60.1 per share, a 41% premium on the share price of $42.7 offered by Konecranes last October.
However Demag’s Management Board have issued a statement to shareholders recommending that they do not accept the tender offer.
Since being alerted about the bid, Demag has sort out the advice of Deutsche Bank and Rothschild and is so far unimpressed by Terex’ assessment of its future earnings.
“The Demag Cranes Group pursues a clear and successful strategy, which is geared to sustained and profitable growth,” said the company. “Given the positive economic outlook and the strategic positioning of Demag Cranes, the board expect to regain strong rates of revenue growth in the next two financial years. As of today, the company anticipates generating a revenue in the ongoing financial year of approximately $1.52 billion.”
Demag also appears to be concerned of Terex intentions towards the company’s existing infrastructure.
“It is not possible at the current time to conclusively assess the strategic aims pursued in the offer or any other intentions of the bidder – including with regard to locations and jobs – especially in light of the fact that Terex has not initiated any discussions relating to the offer until the date of this statement.”
